101 Ash St. in downtown San Diego has been a source of controversy for San Diego city leaders and candidates.
101 Ash St. in downtown San Diego has been a source of controversy for San Diego city leaders. Photo by Chris Stone

Mayor Todd Gloria announced Tuesday a proposed $9.4 million settlement with real estate broker Jason Hughes and his company over the controversial deal to acquire the 101 Ash Street building in downtown San Diego.

The city entered a lease-to-own arrangement with Hughes’ help in 2017 and then found the 19-story building was filled with asbestos and repairs to make it safe would cost tens of millions of dollars.

Last June the city announced a settlement with building owner Cisterra Development, paying $132 million to buy out the leases to 101 Ash Street and the nearby Civic Center Plaza building, assembling a six-block area for future redevelopment.

Hughes was not a party to that settlement, and was named in two lawsuits filed by the city.

Gloria said the initial transaction was ‘tainted” by Hughes’ involvement and called for further investigation after the settlement with Cisterra, but Hughes said he had done nothing wrong in receiving compensation.

“The proposed settlement offers an opportunity to hold Jason Hughes accountable and reclaim every dollar he wrongfully took from San Diegans,” said Gloria and City Council President Sean Elo-Rivera in a joint statement. “We continue to believe he should be held accountable by the justice system for his actions, but we are glad to take this positive step forward as we continue to correct for the mistakes of the past.”

“We thank the City Attorney’s Office for their hard work in ensuring the city recoups money that can be invested back into our community,” the two lawmakers added.

Under the agreement, the city will dismiss all lawsuit claims against Hughes after payment of the settlement amount.

Hughes attorney, Michael Attanasio of Cooley, said he had no comment.

The City Council will be asked to consider approval of the settlement at a special hearing on Wednesday.

Chris Jennewein is Editor & Publisher of Times of San Diego.